Section GB 48 — Income Tax Act 2007: Defined terms for sections GB 45 and GB 46

GB 48 Defined terms for sections GB 45 and GB 46 Affected associate (1) For an arrangement, a person is an affected associate of another person if each person is a party to the arrangement or is affected by the arrangement, and— (a) 1 person is an LAQC and the other person is a shareholder in the LAQC; or (b) the persons are associated persons. Limited-recourse amount (2) A limited-recourse amount , for a limited-recourse loan, means the total for the limited-recourse loan of the amounts for which the obligations of a borrower are affected in a way that is described in subsection (3)(c). Limited-recourse loan (3) A limited recourse loan means a financial arrangement that meets each of the following requirements: (a) it is not an excepted financial arrangement: (b) it involves the provision of money by a person (the lender ) to another person (the borrower ): (c) it has 1 or more of the following effects, or an effect which is substantially similar: (i) relieving the borrower from the obligation to repay all or some of the money, whether the relief is contingent or not: (ii) requiring the borrower to make no repayment for a period of 10 or more years from the date on which the loan is made, other than repayments for the purpose of defeating the intent and application of section GB 46 : (iii) providing that the repayment of the money is in substance secured solely against assets that are employed in the arrangement: (d) if the lender is not an associated person of the borrower, the lender provides the money on terms that are not arm’s length and the lender is either— (i) not a person who regularly provides money to persons on arm’s length terms under arrangements that do not meet the requirements of paragraphs (a) to (c); or (ii) a person who is neither a New Zealand resident nor carrying on business in New Zealand through a fixed establishment in New Zealand: (e) if the lender is an associated person of the borrower, the lender obtains the money under an arrangement that meets the requirements of paragraphs (a) to (c). Defined in this Act: affected associate , arrangement , associated person , excepted financial arrangement , financial arrangement , fixed establishment , LAQC, limited-recourse amount , limited-recourse loan , listed company , money , resident in New Zealand , Compare: 2004 No 35 s GC 30 Section GB 48(1)(b): substituted, on 1 April 2010 (applying for the 2010–11 and later income years), by section 242(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GB 48(3)(d): amended, on 1 April 2010 (applying for the 2010–11 and later income years), by section 242(3) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GB 48(3)(e): amended, on 1 April 2010 (applying for the 2010–11 and later income years), by section 242(3) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GB 48 list of defined terms 1973 version provisions : repealed, on 1 April 2010, by section 594 of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GB 48 list of defined terms 1988 version provisions : repealed, on 1 April 2010, by section 594 of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section GB 48 list of defined terms 1990 version provisions : repealed, on 1 April 2010, by section 594 of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).